DuPont considering alternatives to Performance Chemicals spinoff

A top DuPont official on Wednesday said the company is not ruling out alternatives to spinning off its Performance Chemicals unit.

Late last year, DuPont announced it would spin off the unit into its own company, after several years of volatile titanium dioxide prices. The unit includes headquarters in Wilmington, and the Edge Moor manufacturing site.

On Wednesday, DuPont Chief Financial Officer Nicholas Fanandakis said at a New York conference that DuPont is considering a "Reverse Morris Trust" for the unit, which can create "synergies" with a possible partner, according to a Bloomberg News report. Under such a trust, assets DuPont does not want are spun off, then merged with a buyer. It is a tax-free transaction.

"We are open to the possibility of someone coming in with an RMT or even a sale, a direct purchase opportunity," Fanandakis said at Goldman Sachs Group Inc.'s Basic Materials Conference in New York, Bloomberg reported. "It's got to be of sufficient value, though, to offset the risk and uncertainty that we would take with that endeavor versus pursuing the spin path."

One analyst, Hassan Ahmed of Alembic Global Advisors, predicted DuPont would enter into a Reverse Morris Trust with the company Tronox, which also is in the titanium dioxide business, according to Bloomberg.